Brockhaus Capital Management AG (FRA:BKHT) Is About To Turn The Corner

By
Simply Wall St
Published
September 07, 2021
DB:BKHT
Source: Shutterstock

With the business potentially at an important milestone, we thought we'd take a closer look at Brockhaus Capital Management AG's (FRA:BKHT) future prospects. Brockhaus Capital Management AG is a private equity firm specializing in middle market and buyout investments. With the latest financial year loss of €6.7m and a trailing-twelve-month loss of €9.1m, the €236m market-cap company amplified its loss by moving further away from its breakeven target. Many investors are wondering about the rate at which Brockhaus Capital Management will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

See our latest analysis for Brockhaus Capital Management

According to the 3 industry analysts covering Brockhaus Capital Management, the consensus is that breakeven is near. They expect the company to post a final loss in 2020, before turning a profit of €9.0m in 2021. Therefore, the company is expected to breakeven roughly 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 66%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
DB:BKHT Earnings Per Share Growth September 8th 2021

We're not going to go through company-specific developments for Brockhaus Capital Management given that this is a high-level summary, but, keep in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 23% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Brockhaus Capital Management, so if you are interested in understanding the company at a deeper level, take a look at Brockhaus Capital Management's company page on Simply Wall St. We've also compiled a list of important aspects you should further examine:

  1. Valuation: What is Brockhaus Capital Management worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Brockhaus Capital Management is currently mispriced by the market.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Brockhaus Capital Management’s board and the CEO’s background.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

When trading stocks or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted


Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.